How to Identify Legitimate Trading Platforms
Published May 11, 2021.
When it comes to investing your hard-earned cash, you don't want to be stuck with a broker that isn't legit. Before you settle on a broker or an online platform, you need to do your homework, as there can be fraudulent platforms and brokers out there.
I know that you don't want to be on the wrong side of the situation, so it pays to do a little research ahead of time. Here are some ways to verify that your platform is legit.
Firstly you should check that the platform is with professional organizations.
There is a good tool called BrokerCheck, which is offered by the regulatory body FINRA. The tool shows you lots of data and records of the platform you are interested in.
Check if the platform is registered in corrupt countries or offshore financial centers.
If this passes both tests, the next thing I’d do is research online reviews, where you can gain a lot more info about the platform you are trying to get with.
With my experience, I can recommend you Ameritrade, Webull, and possibly Robinhood.
In the end, don’t ignore any red flags. Go for trusted platforms no matter how much pricier they might be. I would never go for cheaper but riskier platforms.